Thursday, January 07, 2016

The "pipe dream" defense in trade secrets

In the world of patents, the same invention can have different value to different people. As one example, the mouse invented by Xerox had less value to Xerox than to Steve Jobs and Apple. Invention and innovation are two different concepts.

From http://www.pharmalive.com/boston-scientific-engineer-to-be-sentenced-today-for-trade-secret-theft/ on the sentencing of Aaron Khieu, a former engineer with Boston Scientific Corp.

Khieu and his defense attorney are arguing that although he admits to stealing files, his business plan for Snowflake Medical was “a pipe dream.” Nothing was ever produced and nothing came of his plans. “There is simply no evidence that Mr. Khieu intended to inflict a loss in the amount of $4.3 million on Boston Scientific,” the sentencing memo states.

The $4.3 million figure comes from the amount of money Boston Scientific invested in designing the device. One of the key factors in the case is whether the designs for the Mustang Plus had real value. This is a major legal concept in Minnesota, where the case is being adjudicated.

“This is a key question that comes up in every trade secret case,” Minneapolis IP attorney Ron Schutz, who is not involved in the case, told The Star Tribune. “It’s going to be a highly fact-intensive inquiry, which is the general nature of fighting over trade secrets to begin with.”

Sentencing will apparently depend a great deal on what the judge considers the amount of the intended loss was. U.S. District Judge Patrick Schiltz may also depart from sentencing guidelines.

0 Comments:

About Me

I'm a patent lawyer located in central New Jersey. I have a J.D. from the University of Chicago and a Ph.D. from Stanford University, where I studied graphite intercalation compounds at the Center for Materials Research. I worked at Exxon Corporate Research in areas ranging from engine deposits through coal and petroleum to fullerenes. An article that I wrote in The Trademark Reporter, 1994, 84, 379-407 on color trademarks was cited by Supreme Court in Qualitex v. Jacobson, 514 US 159 (1995) and the methodology was adopted
in the Capri case in N.D. Ill. An article that I wrote on DNA profiling was cited by the Colorado Supreme Court (Shreck case) and a Florida appellate court (Brim case). I was interviewed by NHK-TV about the Jan-Hendrik Schon affair. I am developing ipABC, an entity that combines rigorous IP analytics with study of business models, to optimize utilization of intellectual property. I can be reached at C8AsF5 at yahoo.com.